The ruble was highly volatile Thursday, gaining over 2% in early
trading before swinging to a 3% fall on the day. At the time of
writing it was 0.5% up against the dollar as Putin attempted to
reassure people over the prospects for the Russian economy, which
is widely expected to fall into a recession next year
predominantly because of collapsing oil prices and western
economic sanctions over the country's role in the ongoing Ukraine
crisis.

Russia's currency has fallen over 45% against the dollar and the
euro since June, hitting a record low of 80 rubles to the dollar
and 100 roubles to the euro earlier this week. The falls have
tracked the collapse of crude oil prices, which have also tumbled
from their June highs.

The chart below shows the performance of the ruble against the
dollar (orange line) versus Brent crude prices (green line):

Putin praised the actions of both the government and the central
bank in their attempts to mitigate the impact of the currency
falls on the nation's economy. However, the Russian central bank
forecasts that if oil prices remain around $60 a barrel next
year, the economy will contract by about 4% — a severe recession.

Despite the sharp recent falls, Putin again ruled out imposing
capital controls (whereby limits would be imposed on cash
withdrawals and businesses could be forced to sell foreign
currency reserves). He said there were "no plans" to force
exporters to sell their currency earnings.

However, the central bank did
announce emergency measures to defend Russia's beleaguered
banking sector from further ruble weakness on Wednesday.
These include allowing Russian companies not to mark their assets
to market (a measure that will prevent them from having to raise
additional funds to cover potential losses), allow companies to
use exchange rates from the previous quarter when assessing how
much capital they need to cover their liabilities and increase
the number of currency auctions (whereby the central bank
provides dollars and euros in exchange for collateral) it
carries out.

Bank of Russia emergency
measures for Russian companies.Bank
of Russia